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Location-based technologies have grown tremendously this year, mainly due to their integration into Apple’s 3G iPhone. Expect this trend to accelerate. For example, Skyhook Wireless, a company that provides so-called LBS technology to partners, will soon be assisting a major web platform in incorporating location-aware features. Skyhook will also be debuting a location-based advertising platform next year, that will allow third parties to utilize the company’s positioning technology and deliver highly-targeted, location-specific ads.

Skyhook’s XPS hybrid positioning system is a software solution that can use GPS, Wi-Fi, or a cellular radio to detect a device’s location to within 10 meters. By integrating XPS, a major website platform would be able to provide improved search functionality as well as highly-targeted location-based advertising. With the economic downturn forcing companies to tighten their budgets, contextually relevant and local advertising offers the potential of higher click-through rates, and higher revenues.

Next year will be big for local advertising despite economic concerns about online and mobile advertising, Skyhook’s chief executive Ted Morgan tells me.  His belief is mainly fueled by the success of Apple’s iPhone application store. As of early October, Morgan says that Skyhook provided location information to more than 300 iPhone applications.  In less than two months, that number has nearly doubled. In 2009, he believes location-based services will achieve mainstream traction and the number of Skyhook-supported iPhone applications will skyrocket.  Although he offered no specifics regarding which web property would be Skyhook’s new partner, I would think the probable strategic choice would be an established platform with a web application.  Facebook maybe?

Furthermore, Qualcomm has recently licensed Skyhook’s Wi-Fi positioning technology for use in the former’s gpsOne assisted gps positioning platform. By adding Wi-Fi positioning, Qualcomm will be able to provide XPS positioning accuracy. Skyhook, in exchange, will not only receive an undisclosed amount of monetary compensation, but incorporation into the majority of location-aware handsets in the world today.

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